Even as prices rise, the Vail Valley real estate market shows more inventory

Despite a slowdown in units sold, it looks like buyers are finding a way to get into new homes across the Vail Valley real estate market. There’s also a bit more inventory in the system.

Michael Slevin, the president and owner of Berkshire Hathaway HomeServices Colorado Properties, said the inventory in the Multiple Listing Service was about 25% higher at the beginning of July — the start of the third quarter of the year — than at the beginning of June. That increase comes with a caveat. The 400-plus units in the system at the beginning of July were still about half of the inventory available in 2019, the year before the COVID-19 pandemic.

According to data from the Vail Board of Realtors, townhomes and condos spent quite a bit more time on the market in June than they did in June 2023. Slevin said buyers these days are more critical of pricing and condition than they were during the boom days of the pandemic years, when units were sometimes selling within hours of going on the market.

That’s true at all price points, Slevin said.

And, while it’s hard for first-time buyers to break into the market, Slevin noted there are ways for those people to get into their first homes, from down-payment assistance programs to units with deed restrictions. In other cases, buyers are using adjustable rate mortgages to get around current interest rates — currently in the high 6% range, on average — or working with sellers, since every percentage point of interest adds to a mortgage payment.

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“There are a few levers available,” Slevin said.

Matt Fitzgerald, the Vail Valley President of Slifer Smith & Frampton Real Estate, said some activity these days is from people who have been waiting to make a move out of need, and finally have to make that decision. Those reasons often include the need to accommodate a growing family.

Some of those people are breaking loose from what people in the industry call the “lock-in effect,” potential sellers with current low mortgage rates who are hesitant to buy at current rates.

Both Slevin and Fitzgerald said they expected inventory to creep up through the summer. And, Slevin added, the potential of a September interest rate cut by the U.S. Federal Reserve Board could further spur activity.

“That might extend our selling season,” Slevin said. “It will enable more people to have the purchasing power (to get into a home).”